The 208th meeting of the Idaho Lottery Commission took place on Thursday, July 6, 2017 at 10:00 AM at 1199 Shoreline Lane, Boise, Idaho 83702.

Attendees:

Commissioners Present:

Chairman, Mel Fisher

Commissioner, Gary Michael

Commissioner, Susan Kerrick

Commissioner, Craig Corbett

Commissioners Present Via Teleconference:

Commissioner, Grant Brackebusch

Lottery Staff Present:

Executive Director, Jeffrey Anderson

Chief Operating Officer, Becky Schroeder

Deputy Director of Sales, Larry Polowski

Management Assistant, Jennifer QuinnoMiller

Chief Financial Officer, Jay Prickett

Deputy Director of Marketing, Sherie MoodySt. Clair

Public Information Specialist, David Workman

Others Present:

Zeke Chemodurow, Intralot

Ryan Belveal, International Gamco

1. Meeting Called to Order

Meeting was called to order by Chairman Fisher at 10:00 AM.

2. Approval of the Minutes

Commissioner Michael moved to approve the minutes of both the March 18, 2017 and June 29, 2017 Commission Meetings. Commissioner Corbett seconded the motion. The vote was unanimous for approval.

3. Director Update

MUSL Game Updates

The Powerball game will be undergoing a change in April 2018. A new feature is being added where for an additional $1 on top of the base game with the Power Play feature you can participate in another supplemental draw.

Mega Millions will be moving from a $1 game to a $2 game in October 2017. The game will them mirror Powerball more closely with price and odds.

Hot Lotto is ending October 28 and will be replaced by a new game, Lotto America in midNovember. It will be a simple $1 game.

Director Anderson completed his term of Past President of MUSL and the new President of MUSL has appointed Director Anderson to chair the Security and Integrity Committee.

Intralot Implementation Plan

The Intralot implementation is on track and new equipment has been showing up the warehouse ready for placement. The Central Gaming System is changing over in August and new equipment installations will occur in August and September with a go live date of October 1, 2017.

In the original request for proposal, the Lottery asked vendors for 325 vending machines to replace the 325 Winstation vending machines we currently have in the field. All three bidding vendors included them in their proposals, including Intralot who proposed the DreamTouch, their new touchscreen vending machines. In addition to that, Intralot offered 325 new, recertified and refurbished Winstations, which is what we use now. Because of the nature of the scoring of the Proposals, Intralot did not get any credit or any advantage for offering those machines but when we got into negotiations we ended up with 325 DreamTouch machines and 325 Winstations in the contract. What this meant for Intralot is they would have to pay to recertify and refurbish 325 Winstations, have to support two technology platforms, two sets of parts and training for maintenance. Intralot has asked the Idaho Lottery to take the Winstations off the table and offered to provide us with additional DreamTouch machines instead to make it easier and more efficient for everyone. Going forward, we do not believe we will need all of the additional 325 machines but we do believe we will need more than the proposed 325 DreamTouch machines. As this point we have received the proposal for this from Intralot, but have not had the chance for everyone to fully look through it yet.

Director Anderson asked the Commission for permission to continue negotiations on a potential amendment to increase the number full service vending machines on the new platform, DreamTouch, over the next 10 years of the new contract and removing the proposed refurbished analog machines.

Also, if the Commission grants permission to continue negotiations on the potential amendment, and if an agreement were to be reached, Director Anderson has requested a conference call with the Commission on July 20 to review and approve the contract amendment.

Commissioner Corbett moved to approve permission to continue negotiations with Intralot for a potential contract amendment regarding the DreamTouch machines and to schedule a teleconference meeting on July 20 at 10:00 AM. The motion was seconded by Commissioner Kerrick. The vote was unanimous for approval.

Strategic Plan

Director Anderson reported that we are working aggressively to manage our prize expense going forward to increase the margin for a better return to us.

Gift Cards

In May we talked about the possible implementation of gift cards and being able to offer those for the Holidays. The company providing the gift cards cannot get us in stores and in the mix before the holidays so we will be looking at offering them early 2018.

NASPL Annual Conference

The NASPL Annual Conference is September 1315 in Portland, OR.

4. Game Number Request

Chief Operating Officer, Becky Schroeder requested authorization from the Commission for a new range of Scratch ticket game numbers so we can move ahead and use those numbers in our lineup. We are requesting game numbers 14011700.

Commissioner Kerrick moved to approve game numbers 14011700. Commissioner Corbett seconded the motion. The vote was unanimous for approval.

5. Quarterly Current Sales Report

Chief Financial Officer, Jay Prickett reviewed the Quarterly Current Sales Report. Both are entered into the minutes as an attachment.

6. Security Division Update

Deputy Director French reported that they have finally hired a new Detective, Michelle Emmons. She is highly skilled, is a Certified Fraud Investigator and is earning her Master’s Degree. She comes from Caldwell Police Department and has been working in their financial crimes unit for the last 10 years. She is a great fit for the position and we are glad to have her here.

7. Marketing Division Update

Deputy Director MoodySt. Clair reported on Maverik promotions with the Harley Davidson ticket that went well. She handed out the new Marketing Calendar and talked about the new 4th of July Raffle that just launched. The Life is Good Scratch Game will also be launching soon.

8. Sales Division Update

Deputy Director Polowski recapped the recent Sales Rep meeting in Boise which went well. It was a good week and we got a lot accomplished.

The sales team is out in the field doing site surveys of all of the retailers for the Epic Upgrade and he also presented the Super Ticket which is launching soon.

9. Set Future Commission Meeting Date

Commissioner Michael moved to schedule the next regular Commission Meeting for Thursday, September 21, 2017. The motion was seconded by Commissioner Kerrick. The vote was unanimous for approval.

10. Adjournment

Commissioner Michael moved to adjourn. Commissioner Corbett seconded the motion. The vote was unanimous to adjourn.

Certification:

I hereby certify that the foregoing minutes are a true and correct record of the actions and decisions made by the Lottery Commission.